AIA cuts fees on three MPF funds

AIA Pension and Trustee has cut management fees on three MPF funds — the World Bond Fund, the MPF Conservative Fund and the Global Equity Strategy Fund — from 1.75% to 0.99% of net asset value a year; four new funds also carry a 0.99% fee. The cuts sharpen AIA’s position in every MPF fund fees comparison. Senior vice-president Bonnie Tse said the cut serves customers’ interests, not a price war, but she is confident it will lift client numbers and market share.

Why cut fees now?

Tse said the move is about customer value. She declined to comment on whether rivals will follow, but believes lower fees sharpen competitiveness.

Ready for the Employee Choice Arrangement?

On the Employee Choice Arrangement launching in the second half of next year, Tse sounded upbeat, saying AIA will be ready by year-end. The arrangement lets employees transfer the employee-contribution portion of their accounts to a scheme of their choice once a year — set to intensify competition.

Fees matter when choosing a scheme — compare funds at MPF fund comparison.